Volkswagen Group Ireland reported a minor fall in profits and turnover for 2012, at a time when the new car market contracted by 11.6 per cent. Profit before tax was €2.9 million, which represents a 0.7 per cent return on sales. It was down nearly €500,000 on the €3.4 million profit it reported for 2011.
Turnover at the Irish operation fell to €390.8 million last year from €397.9 million in 2011. However, operating costs were reduced to €387.1 million from €394 million over the same period.
The group, which is a direct subsidiary of the German car giant, is responsible for the Volkswagen, Skoda, Seat and Audi brands in Ireland, in the passenger car and light commercial vehicle segments. Between the four brands, the group held a combined share of 25.49 per cent of the Irish new car market in 2012, with the Volkswagen brand the biggest selling marque that year.
The directors’ report states that in 2012, the car market reduced by 11.6 per cent compared to 2011, totalling 79,498 units registered in the Republic. “We have to fear that this situation will not improve in 2013. VGIE therefore was still focused on adjusting cost levels to the economic situation and strengthening its sales and aftersales organisations.”
The firm cut its stock of vehicles from €103.4 million to €83.1 million at the end of 2012. This reduced the amount due to fellow subsidiaries for stock purchasing and therefore the creditors due within one year.
While total staff costs fell from €11.26 million to €11.08 million for the year, directors’ emoluments rose from €746,000 – including €36,000 in pensions contributions – to €842,000. A total of 116 staff were employed by the company, excluding directors.
The Irish division is owned by Volkswagen International Finance, which is a wholly owned subsidiary of Volkswagen AG.
